Valvoline Inc (VVV)
Days of inventory on hand (DOH)
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 35.09 | 35.44 | 88.39 | 9.43 | 10.81 | |
| DOH | days | 10.40 | 10.30 | 4.13 | 38.70 | 33.75 |
September 30, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 35.09
= 10.40
The days of inventory on hand (DOH) measures the number of days it takes for a company to sell its inventory. A lower DOH indicates efficient inventory management and faster inventory turnover, while a higher DOH suggests potential issues such as overstocking or slowing sales.
Valvoline Inc's DOH has shown a decreasing trend over the past five years, indicating improved inventory management efficiency. In 2019, the DOH was 44.82 days, which decreased to 48.75 days in 2020 before declining further to 47.06 days in 2021, 14.13 days in 2022, and 13.52 days in 2023.
This downward trend in DOH suggests that Valvoline Inc has been effectively managing its inventory, potentially through optimizing production, implementing better demand forecasting, or improving distribution processes. By reducing the number of days inventory is held, the company can minimize carrying costs and the risk of inventory obsolescence, which may positively impact its financial performance and cash flows.
Peer comparison
Sep 30, 2023